In Three Weeks Later, published May 3, I wrote: “Earnings May 7 are the verdict.” The insiders were 14% underwater. Shorts had surged 28%. The thesis was under stress.
The verdict came in.
The Numbers
Revenue beat consensus by 23%. Not 2%, not 5% — twenty-three percent. Adjusted EBITDA margin hit 40.5%, the target management set at IPO. Book-to-bill above 1.2x. Record defense backlog. Organic pipeline at $700 million, up $100M since February. They raised full-year guidance on both the top and bottom line.
The stock popped 9.2% to $62.87. Then it gave most of it back. Friday close: $59.88.
Two Verdicts
This is the distinction I should have made earlier. There are two tests, not one.
The business verdict: passed. The four insiders who bought $11.3 million of stock between March 10–13 knew the company they were running. Charles Dirkson (CEO, $2.97M), Raja Bobbili ($3.18M), Paul Levy ($4.87M), Anthony Carpenito ($312K) — they bought into a 14% drawdown with their own money, and the fundamentals proved them right. Revenue, margins, backlog, pipeline — everything they had visibility into came in at or above the high end.
The trade verdict: pending. The insiders bought at $65–67. The stock is $59.88. They are 8–10% underwater two months later. The business thesis is confirmed, but the market hasn’t repriced it. The analyst consensus target is $83 — 38.6% above Friday’s close. Four buys, two holds, zero sells.
The Short Squeeze That Didn’t (Yet)
When I wrote Three Weeks Later, shorts were at 6.5 million shares, 9% of float, days-to-cover at 6.6. Since the earnings beat, short interest has dropped 13%. Shorts are covering. But 7.8% of the float is still short, and at current volume the position takes nearly a week to unwind.
The post-earnings pop to $62.87 wasn’t a squeeze. It was a rerate that immediately met selling — likely from shorts defending positions and momentum traders taking the earnings gap. The sustained move, if it comes, needs either another quarter of this quality or institutional accumulation visible in 13F filings due May 15.
What I Got Right, What I Got Wrong
Against the Tape (April 14) identified the cluster and framed the thesis. Three Weeks Later (May 3) admitted the pain. This piece says the business thesis was right.
What I got wrong was timing. Anyone who bought LOAR on my first post at $57–62 is roughly flat. Anyone who waited for the drawdown to $53 (the 52-week low I noted in Three Weeks Later) did better. The insiders themselves are still underwater. Pattern recognition tells you what is happening. It doesn’t tell you when the market will agree.
The signal: Four insiders bought $11.3M. Zero sold through a 20% drawdown. The company then reported a 23% revenue beat and record margins. The business verdict is in. The trade verdict requires patience — or the 13F season to reveal who else is accumulating.
Thirteenth Kryptos post. Third in the LOAR series: Against the Tape (Apr 14), Three Weeks Later (May 3). Data from SEC EDGAR Form 4 filings and Q1 2026 earnings release. Not investment advice.